Skip to comments.Coronavirus economic threat -- A mortgage industry calamity is looming
Posted on 04/15/2020 7:14:25 AM PDT by littleharbour
Under the CARES Act, Congress has invited millions of Americans to stop paying their mortgages. The impact of this massive unfunded mandate is that the U.S. financial system is headed for a potential default when the cash flow expected from millions of Americans does not arrive.
(Excerpt) Read more at foxbusiness.com ...
Mortgage companies should have put the payments on back of loan during this time. Many companies have this feature anyways should a person be in a tight spot they offer the option of throwing a payment on back of loan. Just a thought.
All the more reason for the economy to be re-opened as soon as possible. Err on the side of risk.
Me, I’m looking to pick up a vacation home from some failed AirBNBer that runs out of gas sometime after August or so.
Glad I paid that off two years ago
I agree, I believe low count states/counties should open up and open up immediately
Not a bad thought although the mortgage holders who need it are the most likely to default. It makes the problem a little bit worse in the end.
Saw this coming, so paid off the mortgage in preparation of the potential fallout...
Their debt and expense structures wont allow them to do that on such a large scale.Theyll have to ask for a bailout, too. Uncle Jerome will just have to put a couple trillion more on the credit card...
Makes great sense!
When this is done, some people will get rich and some will be destroyed. But that is the purpose of government, right?
Has there ever been a country in history that has committed economic suicide on such a scale as ours? I doubt it.
I believe that during the currency collapses of the early nineteenth century that people on whatever property it was wound up still on the property and lein holders got...now worthless money that lending contracts specified had to be paid.
I am perfectly okay with that model if the nation spends itself into oblivion.
I completed a refi on 2/27/2020. And I am paying on time (still working for now...)
Fiancee and I are looking for a house around $250,000 in the Dallas Fort Worth suburbs - 2 we liked dropped $10,000 and $15,000 THIS week, banks will be flooded with them in Sept - may get a house and a lake house for that price.
Looks like its time to dust off this old website:
Five weeks ago (it now seems like another galaxy), the economy was roaring, the best economy in the history of the world, and then it turned on a dime. I believe it is now too late to reopen the economy, that Great Depression II is already underway, and that it will get much worse before it gets better. The twenties of hte 21st century will be like thirties of the 20th century.
Probably, a sizeable chunk of people aren't going back to shops, stores, restaurants, outings, etc. for a very long time.
Unfortunately, my mortgage holder is a douchebag: they will let things slide for three months but then all three months plus the fourth month will be due immediately, no matter what kind of "bailout" they get (which I'm sure they will keep).
That's a pretty big hit for anyone who wasn't getting paid while forced out and would just be getting back on their feet.
Spread the three months out over the year. They undercharged us for escrow and gave us the option of paying the balance upfront and keeping the monthly due the same, or spread it out over a year. So why not do the same with this? IDK
> “... Congress has ***invited*** millions of Americans to stop paying their mortgages.”
Invited? Yep, no bias there.
How about ‘rescued’ as in temporarily rescued?
If you’re ordered to stay home during the pandemic and can’t go to work to earn your pay, somehow over-leveraged Wall St hedge fund loan sharks think you should be kicked out onto the coronavirus-ridden streets and foreclosed on even though you made every mortgage payment over the years without skipping a beat.
Had a builder work for me few years back tell me that after the financial collapse of 2008-2010 that “Never Again!”
I asked, “Never Again What?”
He said, “Wells Fargo”.
Me: “Wells Fargo what?”
He said Wells Fargo taught him an important lesson in life, to never have a mortgage again as long as he lived. He went on to buy land outside the City, put in a well and septic, built a home, installed propane and backup generator, and used county power sparingly. Minimal bills.
Today he’s thriving.
And apparently you don’t need to be a builder today to do this. There are several high-quality kit homes that can be bought for under 50k and that are expandable.
Can you imagine sound money letting Americans save for a nice home that they pay cash for?
I know, difficult to believe.
A degreed IT pro making $175k per year in SF had to flee with his wife and take a remote job because there was no way for them to start a family and even if they continued to put off having children, they were struggling just to survive. A video showed their lifestyle to be very modest.
Youthful Georgetown Law School grad friend of mine back in 2007 rented a studio apartment in Midtown Manhattan because he wanted to be near the Wall St. ‘buzz’. I asked him what that meant and he said there were a lot of ‘tips’ (leaks) that could be overheard in the restaurants and cafes in that part of the City. I asked him what his studio was like, did he have a view of Central Park? He would never take anyone to see his place as he said it was only used for showering, sleeping, surfing the net, etc. He said there was no view to brag about, said his studio had a double bed, a desk, a closet, a mini fridge, a bathroom and shower stall.
His rent? $4400 per month.
I told him he was stupid, he told me I was stupid (we were like brothers).
We settled that argument when he moved out in 2010. I won that argument.
Shutting down the economy is stupid without knowing the FATALITIES AS A PERCENTAGE OF THE INFECTION RATE.
We need more ANTIBODY STUDIES ASAP!!!
A 1000 person German antibody study by the University of Bonn resulted in a death rate of those infected at 0.37% and a CV infection rate at 15%. The Diamond Princess had an infection rate of 17%.
CV appears to be MORE CONTAGIOUS and LESS LETHAL than we thought.
If this is correct, the US economy should be reopened NOW, all schools reopened, protect the elderly with preexisting conditions and stop this MEDIA DRIVEN PANIC & NONSENSE.
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